The Swiss National Bank has posted a loss of $23 billion for 2015 because of its efforts to strengthen the Swiss franc and due to the decline in the value of the bank's foreign currency holdings.
The bank incurred losses before, but the loss it saw this year is a record one. The central bank’s decision to end its cap of 1.20 francs per euro and its attempts to depreciate the national currency that sent it soaring in value against the euro stand behind such a massive loss. Throughout the year, the central bank intervened in the currency markets.
In 2010 the Swiss National Bank lost 20.8 billion francs in connection with the decision to restructure the Greek debt.
The loss of the previous year is the largest since the bank was founded in 1907. The Swiss franc has always been a safe haven currency for investors.
The weakening euro against all major currencies after the European Central Bank’s stimulus measures triggered the franc’s appreciation. The euro accounted for 42% of the SNB’s foreign currency investments, followed by the dollar at 33%.
Moreover, the bank expects a further four billion franc loss from falling gold prices on world’s exchanges. However, it plans to get a one billion franc profit from appreciation of its currency.
